CHICAGO - It??s the bank, not the convenience store, that is responsible for debit holds of $50 to $100, notes Chicago Sun-Times consumer advocate Stephanie Zimmermann, otherwise known as "The Fixer."
"I purchased gasoline (and) upon going home and checking my account online, I noticed that there was an additional $100 taken from my account in the form of a pre-authorization hold. The hold was on there for 48 hours," noted a concerned consumer, adding that the transaction was using PIN debit. "So my $56.51 purchase cost me $156.51 for that weekend, holding up the little money I get each week from unemployment."
The newspaper dug into the details more and after confirming with the retailer and NACS that all PIN debit transactions should clear almost immediately. The bank reported that "a glitch in their computer network" prevented the issue from being properly resolved.
Thanks to the efforts of "The Fixer," the customer and readers learned more about the issue of debit holds and how retailers are not responsible for them, even though they typically receive consumer ire when someone experiences and overdraft.
The reality is, many times the holds in signature debit stay in place for days and can trigger inadvertent overdrafts, resulting in hefty fees.
When using a PIN number, the retailer picks the hold amount, which is quickly erased after the actual amount is transmitted. For signature-based debit cards and credit cards, the issuing bank chooses what the pre-authorization amount will be and the holds can hang around on the account longer.
Jeff Lenard, NACS spokesperson, told the reporter that the association has heard numerous horror stories of motorists causing multiple overdrafts or travelers locked out of their funds because of filling up their cars with signature-based cards. With gasoline prices climbing recently, retailers might hear more complaints about pre-authorization holds.
For more information, check out the NACS Fact Sheet "Debit Holds for Fuel Purchases."